More details on time-share study
RCI Consulting, one of the nation’s leading time-share experts, is in the process of finding an answer to the question burning on the minds of city officials: Will a partial time-share conversion at Embassy Suites Resort work?
The feasibility study, mandated by city leaders, should be completed by early October. The results will most likely be discussed at the Oct. 21 City Council meeting rather than the Oct. 7 date initially targeted, said Judith Von Klug, redevelopment manager.
“There will be so much complex information in that report that we will need time to study and digest it,” she said. “Waiting until Oct. 21 will also give us time to get the information out to the community before a decision is made.”
KOAR-Tahoe Partners, L.P., owners of the Stateline-area hotel, have asked the city to allow the conversion of 188 of the hotel’s 400 suites to time-share units so the company can avoid bankruptcy.
The city is concerned with maintaining its Transient Occupancy Tax revenue stream and preserving planned redevelopment efforts, among other things.
According to the contract with RCI signed by City Manager Kerry Miller, the firm – based in Eugene, Ore. – will be paid $23,000 plus travel expenses and per diem fees for the market saturation and financial analysis.
City officials say KOAR-Tahoe Partners will pick up the tab, but will otherwise not be involved with or in any way influence the outcome of the study.
The results of the analysis will be used to decide whether to revoke the city’s five-year moratorium on time-share conversions, passed in 1996 to protect the Park Avenue Redevelopment Project. That project includes a 200-unit time-share complex, for which a developer has not yet been secured.
If city officials decide to allow the conversion, study results will also be used to determine an appropriate developer’s fee for previous infrastructure costs as well as for facilitating the conversion process, the contract said.
According to the scope of study, the analysis will have seven objectives, each with an outline of methodology. They are:
— To determine the market area and define characteristics of current and potential visitors to South Lake Tahoe, using existing studies completed for the property, other regional tourism studies and reviewing all relevant competitive projects.
— To determine characteristics of households within the designated market areas by reviewing secondary data on their economic trends, population projections, income intervals, and vacationing and recreational activities.
— To determine the extent, type and success of other projects competing for KOAR’s potential costumers within the market area, using RCI’s extensive data base on resort timeshare patterns, including number and type of current owners, pricing structures, amenities and services.
— To determine the most marketable products by integrating the existing informational base from prior research and information obtained from other aspects of this study.
— To determine the potential market depth for the project. The consultant intends to review data on tourism trends in the region, consumer characteristics, number of income-eligible households among tourists and residents and existing market penetration rates from surveys of the competition.
— To recommend the best product mix and structure in order to determine the most appropriate offering possible, looking at characteristics, amenities, services and sales pace.
— To prepare a detailed financial analysis that will include a review and critique of the existing feasibility analysis already prepared by KOAR; a review of the operating records of the Embassy Vacation Resort at Ski Run Marina; and a review of additional information provided by the city, KOAR and Signature Resorts.
RCI Consulting, formerly Ragatz Associates and Global Resorts, has conducted about 90 percent of all time-share feasibility studies in the country, according to the company’s proposal.
The firm in 1992 completed “The Resort Timeshare Industry in California” for the American Resort Development Association, in which the Lake Tahoe region is studied.
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